TWO in three young couples could soon be priced out of the homes market, a minister said yesterday.

Housing Minister Yvette Cooper warned of a growing divide between those who owned property and those who did not.

She said: "If we do not provide the homes that people need, we risk facing serious social and economic consequences.

"To sit back and do nothing would be irresponsible...it would deny too many of our sons and daughters the chance to live in the area they grew up or the area they need to work."

Ms Cooper said 46 per cent of couples hoping to set up home in the 1980s could afford to buy a property

By 2002 the figure had dropped to 37 per cent, Ms Cooper told a London conference organised by the homeless charity Shelter.

Warning of a continuing fall to a possible 30 per cent, she added: "If we do not build more homes, Government analysis indicates that number will drop further to below a third able to afford to buy."

Ms Cooper said more people risked becoming homeless, living in overcrowded conditions or over-stretching their finances to afford property.

She added: "Already in London over a third of first-time buyers rely in part on gifts, family loans, or windfalls.

"Yet it is unfair if people's chances of buying their own home depend on whether their parents or grandparents were home-owners before them. We cannot ignore this problem."

A new study from Shelter, titled The Great Divide, said inequalities in housing were greater than at any time since the Victorian era. Some 1.4million households in England with children aged under 11 live in run-down homes. Shelter said there was an increasing gap between families who owned a house and those who did not.

The charity's director Adam Sampson spoke of the "shocking extent" of the inequalities caused by housing.

He said: "It is clear that, if anything, they are set to deepen and risk marginalising a whole section of society.

"The Government has clearly placed housing on the agenda for its third term.

"But it must act quickly with radical and far-reaching policies if it is to narrow this damaging divide."

Ministers have already outlined plans to try to increase house-building. But they have faced resistance from environmental and countryside groups, who fear the loss of open areas.

The Shelter study urged higher investment in social rented housing to bridge the prosperity gap.

In the last decade, it revealed, housing wealth per child in the 10 per cent most affluent areas has increased by 20 times that of the least affluent 10 per cent.